Tesco v Constain - Thomson Reuters

(1923) 16 Ll. L. Rep. 325 Page 11923 WL 18433 (Sh Ct)(Cite as: (1923) 16 Ll. L. Rep. 325)*325 Seed Shipping Co. v. Owners of "Baron Cathcart."Glasgow Sheriff's Court.Sh Ct (Glasgow)Monday, July 9, 1923.Before Sheriff-Substitute A. D. Thomson.Sale of Ship--Verbal Offer and Discussion --Acceptance in Writing--WhetherContract concluded--Want of Consensus ad idem--Condition as to Drydockingdiscussed but not agreed to.This claim arose out of an alleged contract for the sale of the vessel at theprice of £16,600. The Sheriff-Substitute found that there was not completeconsensus ad idem between the parties, and that in consequence there was noconcluded contract. He therefore assoilzied the defenders and granted theirexpenses.The SHERIFF-SUBSTITUTE , in a note attached to the judgment, said that thepursuers craved in effect a decree for delivery of the steamer in exchange forthe contract price. The defence was that there was no concluded contract of sale.It was therefore incumbent upon the pursuers, if they were to overcome thisdefence and establish their claim, to prove that there was a concluded contract.They endeavoured to do so by founding upon a letter which they delivered to thedefenders on Feb. 17, 1922. The letter was in the following terms:--s.s. Baron Cathcart .Referring to conversations of date, Mr. Dunn has been on the telephone withMr. Seed and is now instructed to accept your offer of this steamer at £ 16,600(covering total commission of 3 per cent.), on conditions as discussed andverbally arranged to-day. We will draw up the contract on Monday morning andsubmit it for your approval and signature. Mr. Seed's inspector, Mr. Thomson,will be at the steamer on Monday in the early afternoon to examine the tanks andthe machinery and donkey boiler as arranged with Mr. McNaught.--Yours truly,Thos. McLaren & Co.The letter was perfectly distinct in its terms, and on the face of it was anacceptance upon the conditions referred to of a verbal offer of the steamer atthe price of £16,600. The pursuers' case was based entirely upon this letter,their case being that it was a valid acceptance of a subsisting offer, whereby acontract was duly concluded.The defenders, however, met this case by three contentions, viz.:--(1) Thatthere was no offer open for acceptance when the letter was written. (2) That theparties having, if they contracted at all, contracted under mutual error, werenot bound by the contract, the error founded upon being the mistaken belief thatthe steamer had passed her No. 1 official survey. (3) That no contract wasconcluded, because the parties contemplated that there should be no bindingengagement until a formal contract should be entered into and executed-- whichwas never done.On the first point, he considered in view of Hyde v. Wrench, 3 Beav. 336, citedin Anson on Contracts, that the letter quoted was a timeous and valid acceptance,and therefore primâ facie sufficient for the concluding of a contract.The second point was that the parties, if they contracted at all, did so undermutual error. The defenders represented to the pursuers that the vessel hadpassed her No. 1 survey. This, however, was not the case. Both parties believedand were negotiating in the belief that she had passed it. They were both,therefore, in error. Did this mutual error justify the defenders in repudiatingthe contract? He felt compelled to answer the question in the negative.Accordingly he thought that second defence to the action fell to be repelled.Copr. © West 2004 No Claim to Orig. Govt. Works